SOCIAL AND SOLIDARITY ECONOMY. A SOCIAL AND SOLIDARITY ECONOMY. A POLANYIAN PERSPECTIVE FROM THE POLANYIAN PERSPECTIVE FROM THE

PERIPHERYPERIPHERY

José Luis Coraggio

The Solidarity and Social Economies North and SouthThe Solidarity and Social Economies North and SouthForesight Centre, University of Liverpool., March 14-15 2012.

2012

What do we understand by

Social and Solidarity Economy (SSE)?

It is an aggregate of economic organizations, a sector -more or less organic- constituted by solidary relationships, internally (e.g. cooperatives, mutual support networks), among them (e.g. association of producers and/or consumers, fair trade) and with their grassroots' communities, generating a social fabric conducive to attain a good life for all (Buen Vivir).

It is also a project of counterhegemonic action (including solidary practices for everyday collective reproduction of life as well as collective strategic actions) in a long transition aimed at counteracting the negative trends of the capitalistic system (in the material and subjectivity conditions) with the perspective of increasingly building an alternative social and economic system (e.g. Ecuadorian Constitution).

In Latin America there are three main lines of though and action in the field of SSE. They can be seen as different moments of the process of building a SSE, although they are differentiated by their actual methods and goals.A. The inclusion in the market of isolated impoverish groups (micro level) excluded from/by that same market, hybridizing resources and favouring the association. Financial micro-economic efficiency and expectative of solidary markets (oxymoron?). Functional internal solidarity.B. The formation of an organic (meso level) sector of SSE, -across social classes- in intersection and tension with the three sectors of the mixed economy combined: Entrepreneurial, Public, Popular. Civil Society over State predominance. Social efficiency and subsidies. The question of scale.C. The transition to a different economy (systemic level) (FSM: Another Economy, “with market”, “with State”, generalized reciprocity and redistribution, “overcoming of centre-periphery scheme”, Buen Vivir/Vivir Bien), societal and all inclusive approach , in a cultural and political struggle against hegemonic capitalistic system. Gramscian

approach to the State. Democratization of the State.

Non specific XX Century historical background of SSE practices: Latin American historical and new social movements and streams of social and political though:

1. Socialism and anarchism (civil society associations)2. Dependency theory (Centre/Periphery)3. 1917 university reform (social “extension”: incubators)4. Social doctrine of Catholic Church (assistance to the

poor)5. Freire’s pedagogy of liberation and popular education6. Theology of Liberation (CEB, struggle for

emancipation)7. Indigenous peoples’s Cosmo vision (struggle for

territories and decolonizing of culture)8. Peasant’s movements (“Via Campesina”, struggle for

land and water)9. Feminist movements (struggle against patriarchy10. Ecological movements (struggle against extractivism)

THE INFLUENCE OF KARL POLANYI

Recently, the current ‘C’ has found inspiration in the works of Karl Polanyi, assuming some of his postulates :

a. The formal definition of the economy must be replaced by that of a substantive economy (and his ethical principle : subsistence for all). Formal economics (theory and practice) must be challenged in defence of the cohesion of society.

b. The understanding of empirical economies requires an institutional (historical, anthropological) analysis of their effective social embeddedness through a set of general principles of organization. KP highlights three universal principles: Redistribution, reciprocity, exchange (commerce or market), and the capitalist fictitious commoditization of labour, land and money.

c. Economic (Neo) Liberalism and his political strive to impose -by means of all sorts of violence (KM’s )- a “self-regulated (total) market” desembedded from society have proved to be destructive of society and nature and his triumph would be suicidal.

d. For the sake of its cohesion, societies will undertake a movement of resistance and (re) embededdment of the economy. Fascist and authoritarian tendencies might appear to re establish the capitalist order.

e. It is possible to build another economy proposing a program of collective social and political action, changing the hierarchy of integration principles and reversing the commoditization of labour, land and money.

f. The contribution of trans-disciplinary social sciences, critical of economism, is a requirement of social change.

A PERSPECTIVE FROM THE LATIN AMERICAN PERIPHERY

(Some conceptual limitations of Polanyian schemes that should be overcome)

a. KP’s description of the process of construction of the capitalist market ignored the process of colonization of America, and its role in the emergence of Europe - North America as we know it.

b. The centre/periphery world-system has mutated and persisted through the centuries. Marx’s primitive accumulation applies, conveyed by military violence and most inter-State institutions (WB, IMF, OAS, WTO, etc.)

c. The principles listed by Polanyi are insufficient to understand how the economies of the periphery work. It is important to include the contributions of Marx. Particularly including the centrality of modes of production and the dialectics of actual empirical relations.

d. His enumeration of principles of social integration of economies should be completed and made dialectic.

AN ENLARGED SET OF PRINCIPLES OF SOCIAL INTEGRATION OF THE

ECONOMY

BASIC CATEGORIES

1. PRODUCTION 2. (A) DISTRIBUTION (primary appropriation) and (B) REDISTRIBUTION3. CIRCULATION4. CONSUMPTION5. COORDINATION

Production/appropriation

1. PRINCIPLES OF SOCIAL ORGANIZATION OF THE LABOUR PROCESSES :

Property and management of means of production (MP) and power to organize the production process: private –worker/capitalist, non capitalist: public, commons, communitarian (usufruct), associative, servitude,…

Relation with Nature (extractivism, ecological equilibriums, the rights of Nature) and management of technological change.

Rules of the division of labour: autarchy/self sufficiency, complementarity/cooperation, competition.

2A. PRINCIPLES OF PRIMARY APPROPRIATION OF WEALTH (individual workers, cooperatives, communities, private owners of MP…)

2B. PRINCIPLES OF REDISTRIBUTION (progressive/regressive)

3. PRINCIPLES OF CIRCULATION (reciprocity; exchange : administrated commerce, self-regulated market commerce). The functions of money.

4. PRINCIPLES OF CONSUMPTION (prudential attention of everybody’s basic needs; unlimited individualist consumerism)

5. PRINCIPLES OF COORDINATION (self-regulated market, social planning and regulation; intersectoral/interregional covenants of complementarity…).

All empirical economies are mixed economies

SSE must work at all three levels:

A>>B>>CA. The inclusion of isolated groups excluded from/by market

favouring the association… sustainability = financial microeconomic market efficiency…

B. …progressively included in the process of formation of an organic sector of the SSE (networking, local and trans-local subsystems of production and reproduction, struggle for legal recognition, social money, fair trade, ecological sustainability, etc.) in intersection and tension with the three sectors of the mixed economy recognizing the plurality of economic forms...

C. …as part of a more complex process of political and cultural transition to a socially rational economic system. Social efficacy = contribution to systemic life reproduction

PUBLIC ECONOMY

POPULAR ECONOMY

PRIVATE ENTERPRISE ECONOMY

Mixed enterprises:

Public/capitalist

Philanthropy, foundations, NGOs, co-management, labor and capital cooperatives

NGOs, civil society SOCIAL

AND SOLIDARITY ECONOMY

Nation, regions, provinces, municipalities, public enterprises, sectoral agencies

Capitalist enterprises, holdings, clusters, corporations…

Participatory budgetingassociated management, co-cnstruction of public policies

Redistribution,Social inssurance, health, education,planning, market regulation, monetary sovereignty …

Reciprocity, cooperatives, associations, mutuals, social enterprises, social networks, communities,

Domestic Economy: self-consumption, reproduction and sale of salariate

labour; family small enterprises,

peasantry, urban informal sector…

La Economía Solidaria en la Economía Mixta

OTHER QUESTIONS

TO BE CONSIDERED

a. The popular economy (not the “informal” sector) as a category of the economic system.(Coraggio)

b. Criticism of modernity, race and patriarchalism, the coloniality of knowledge. Criticism of the modern paradigm of science, recognition of a diversity of epistemologies.(Hinkelammert, Quijano, Dussel, Lander, Santos…)

c. Redefinition of the (plural) social and political subjects.The new social movements. (Laclau, Santos…)d. Rethinking the political and politics. The reinvention of

the State. (Santos, Dussel…) e. Fascism must be seen not only as a political regime but

as a social system that could even coexist with formal democracy. (Polanyi, Santos…)

SOME FEATURES OF

THE PRESENT PROCESS OF ESS

IN LATIN AMERICA

Some weaknessesControversial issues related to actual practices of SSE

Microcredit as a gainful business (WB, BID, private Banks, financial cooperatives or NGO’s as enterprises) Fair trade as a gainful business. The issue of certification.Introjection of capital enterprise criteria of efficiency (competitiveness) and financial sustainability (the issue of subsidies)Emphasis in commerce over building production systemsRedistribution of income as social assistance to the poorPolitical electoral pragmatism (governability, token redistribution of basic resources: technical knowledge, land and water, credit, no attack to national corporative power)Tendencies to fragmentation for lack of a common Political project and excess of narcissist behaviour)Neoliberal strategies of globalization have generated de-industrialization and primarization of LA economies. Wealth concentration has not yet been reversed. This generates political contradictions among specific ethical principles (no extractivism) and the principle of political responsibility (governability and electoral feasibility of progressive proposals : balance of power, neo-developmentalism, consumption and macroeconomic dynamics

Some strong points

Emergence of popular (populist?) governments made possible trough the struggles of new and traditional social movements resistance.New Constitutions (Bolivia, Ecuador, Venezuela) proposing:

Significant reforms of the State and its relation to society. Another economy oriented by an ethic of life and diversity.

Metaphors: Buen Vivir/Vivir Bien, Plural Economy, XXI Century Socialism. SSE, solidarity economy, popular economy, community economy. Recognition of Nature as a subject with rights. Formal recognition of popular economy and the plurality of their economic forms.

New forms of inter-State joint action (ALBA, UNASUR, CELAC…) in search of a redefinition of centre/periphery relation. Resistance to the Institutions of the capitalist inter-State system (IMF, WB, WTO, CIADI, FTA).

Generalized application of monetary transfers applying the principle of redistribution. A fight for its meaning is taking place.

Selective re-nationalization of monopolistic strategic sectors of the economy. State re-appropriation of rents through circulation controls.

Advances in the recuperation of territories and recognition of the indigene cultures. Advances on land redistribution to peasants and limits to land concentration

Increasing articulation of social movements for a SSE at a continental and global level (FSM…)

Emergence of specific national SSE collective organizations and networks

We are engaged in a counter-hegemonic struggle against a capitalistic culture, with social and political subjects in a magmatic state, restarting with a social State deactivated during three decades. This is the national context of SSE practices.

There is hope but not triumphalism. An equivalent counter-movement of societies from the North could be decisive.

There is an urgent need for (re) structuring of systematic critical knowledge, with a pluralistic theoretical and reflective approach, committed to the democratic struggle for social and natural life.

Thank you for your attention

José Luis Coraggio

Director, Master of Social Economics Program

Instituto del Conurbano

Universidad Nacional de General Sarmiento (Argentina)

www.ungs.edu.ar

www.coraggioeconomia.org

jlcoraggio@me.com